It may be new for some people but it has existed in the past few decades in other countries. For some it is a form of religious-based investing using the principles and teachings according to one’s belief and denomination. It is somehow helpful in providing spiritual guidance on one’s financial growth although churches or religions are nonprofit organizations and they do not issue stocks or shares. In the Philippines, there are no religious-based index funds or financial products available in the market. However, first- world countries such as the United States, Europe, Japan, Australia, the Middle East and our Asean neighbors like Malaysia and Indonesia have religious-based investment products based on Koran do exist in great numbers and people of different religious denomination invest in it.
Let’s have an example of the two of the three great Abrahamic religions in the world that have great presence in the Philippines:
First, the Christians who account for 94 percent of the population of this country follow investment principles that should not go against their teachings and should be pro-life, pro-family, biblically, ethically and morally viable Christian-based investing. The Roman Catholic Church, for instance, the largest Christian denomination in the world, has a lot of investments in diverse places globally through its investment-management institutions in Rome, New York or elsewhere. Even some of the local archdioceses of the Roman Catholic Church in the Philippines invest in the Philippine equities for the upkeep of its churches, the wages of nonclergy workers, retirement benefits or pension of retired clergymen and women, the maintenance of its charitable institutions like hospitals, orphanages and seminaries, even carry out evangelization missions to far-flung communities in the archipelago, just to name a few. The same goes with the other Christian religions or sects.
Second, Islam has religion-based investment concepts in Shari’ah-context. Shari’ah based investments generally avoid sin stocks/shares where companies or investments groups are involved or are profiting from alcohol, gambling, pornography, pork, tobacco, arms/weapons of mass destruction, embryonic stem-cell research and others. Also, Islamic-based finance avoids interest earnings on loans, derivatives or even bonds which are sinful and prohibited (“Haraam”) activities under Islam. Before the establishment of Shari’ah-compliant stocks, the majority of Filipino Muslims invest in Shari’ah-based stock indexes either in neighboring Malaysia or in the Middle East. Right now there are at least 61 firms out of the 306 listed companies in the Philippine Stock Exchange (PSE) that are Shari’ah-compliant since 2014. More recently, the PSE has started pushing for a Shari’ah based subindex in the Philippine equities market according to news reports. This development was meant to entice Filipino Muslims and investors from the Middle East to invest in the growing Philippine economy.
WE know for a fact that one’s religious belief does give one’s moral sense. One should be socially responsible in one’s personal finances. In my opinion, all religions may it be Christian, Muslim or some other denomination must be proactive in instituting basic financial literacy with spiritual guidance among its followers which I believe could do wonders for ordinary Filipinos. We know for a fact that the majority of Filipinos do not have a deep understanding of personal finance or if they have, cannot carry it out because of lack of will to do it. In the Bible, there are several verses urging the responsible use of money that can help shape one’s outlook in life. They should see money not as an evil but as a tool to improve one’s self and to help others.
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